July inflation data in the US brought a pleasant surprise to the market. Consumer prices rose only 3.5% year-over-year, while the consensus forecast from analysts had anticipated 3.8%. This served as a powerful catalyst for risky assets, including cryptocurrencies.
Bitcoin instantly reacted to the news, reclaiming positions above $63,000 and closely approaching the $64,000 mark in the first minutes after the release.
Macroeconomic Background: Pressure Eases
The Core Consumer Price Index (Core CPI), which excludes volatile food and energy categories, came in at 2.6% year-over-year against expectations of 2.8–2.9%. On a monthly basis, prices fell by 0.4% — indicating that the disinflationary trend is gaining momentum.
The key driver of the slowdown was the decline in energy prices. Notably, the monthly Core CPI showed zero dynamics (0.0%), confirming a general easing of price pressure across a broad range of goods and services.
For the crypto market, lower inflation is a direct signal for growth. Soft CPI data reduces the likelihood of aggressive monetary policy tightening by the Fed, which automatically boosts risk appetite. Yields on 10-year US Treasury bonds moved lower, while Bitcoin and altcoins began a confident recovery.
Fed's Hawkish Stance: Waller Holds the Line
On the same day, Federal Reserve Governor Kevin Warsh testified before Congress, reaffirming the regulator's determination to keep inflation under control. "The Fed does not intend to tolerate prolonged high inflation," he stated, emphasizing that monetary policy sets the level of core inflation.
Nevertheless, the labor market remains stable, alleviating urgent recession fears. The target range for the key interest rate remains at 3.50–3.75%. The CME FedWatch tool shows that traders assess the probability of a rate cut at upcoming meetings as moderate, but clearly higher than a month ago.
July CPI data is the first report in 2026 that unequivocally points to a resumption of the disinflationary trend. This is a critically important signal for investors who remember how prolonged price increases forced the Fed to maintain a tight policy longer in the past.
My view as an analyst: We are entering a phase where the macroeconomic backdrop is starting to work in favor of the crypto market. If the trend continues, the second half of the year could become a period of sustained growth for risky assets. However, one should not forget that the Fed will act cautiously — the balance between optimism and risk hedging is now more important than ever.